We are getting this question a lot - how do you know if a net metering bill is a good one, or a bad one (or somewhere in between)?

44 states and Washington DC all have statewide net metering policies. Kansas does not. However, not all net metering policies are worth the paper they are written on.

And the fate of net metering in Kansas will turn on a few crucial points. First, who REALLY wants net metering? The general argument against the policy is that it benefits rich people who can afford solar panels and wind turbines.  However, there seems to be a rising swell of people who can't afford to install renewables WITHOUT net metering to at least help reimburse their costs.

Second, is net metering a subsidy? If so, is it a bad one - especially when it comes to helping farmers, schools and businesses offset energy costs during difficult economic times? Are the public policy benefits of energy security, energy independence, etc., worth the subsidy?

And last, regarding the burdens of net metering policies, are those burdens equally spread across all utilities? Rural co-ops and munis might have very different perspectives on net metering than investor-owned utilities.

CEP thinks that ultimately, the answer to the net metering question is only going to be solved by Kansans putting their heads together and figuring out what works. When you do, here's some research that CEP put together a few months back. We're sharing it here with you here just to give you a place to start.

BTW - if you want to know anything at all about renewable policy this session, here is the best resource - the extremely easy to use Database of State Incentives for Renewables and Efficiency - http://www.dsireusa.org.

And finally, a little known fact - interconnection standards are a critical part of net metering. (You can have the best net metering policy in the world, but if you can't hook up to the grid economically, effectively, and safely, then what good does that policy do you?)

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Interconnection Standards

- How can a simple, standard, streamlined interconnection process for small generators be created?
- What are the regulatory barriers that restrict fair customer access to the grid by creating high costs and time delays – excessive standards for safeguards, grid upgrades, operating restrictions, insurance requirements, application lengths, etc.
- Are utilities required to process interconnection applications within a reasonable time?
- FERC has already adopted voluntary federal interconnection standards for systems under 2 megawatts (MW).
- Are there hidden costs allowed that will put additional burdens on customer-generators – such as high standby charges, back-up rates, or unnecessary requirements for insurance?
- Do different interconnection standards apply for different sizes and designs of generators? Different generators should be recognized as having varying levels on the system, from minimal to higher impact.
- When smaller and simpler generators are standardized according to national certifications (IEEE or UL), there should there be a streamlined application. Larger projects may need additional review.
- If there are application fees, do they differ with size of installation?

EPA, Clean Energy, State Best Practices, State Guide to Action “Interconnection Standards,” http://www.epa.gov/cleanenergy/documents/gta/guide_action_chap5_s4.pdf

Fair Net Metering

- Net metering is defined as when customers sell back their excess power through their interconnection to the grid using a single, bi-directional meter.
- What utilities are required to participate? Are there different rules for rural electric cooperatives and munis?
- For net excess generation (NEG), what reimbursement rate represents a fair price? Some percentage of avoided cost? Time of use? Retail? A combination? Is the agreed upon price credited to the bill, or is an actual check issued? Example: In many states, utilities credit the customer’s next bill at the retail rate, but at the end of the year purchase the excess at avoided cost rate. Oregon credits the customers’ bill at retail, and each March credits the excess to weatherization and low-income assistance programs.
- Is there a time limit to credits, or do they expire? Is credit banking possible, so customers can offset their costs during the high use times of year (works for irrigation)?
- Policy goals - what are the technologies and installation types that the legislation is meant to encourage? Small wind for homes, farms, and schools? Solar panels for businesses? Etc.
- Are there hidden costs that will create disincentives for customers? For example, standard installations come with a shut-off switch. However, when a utility requires a redundant external shut-off switch to be installed at customer expense, the cost for that alone can range up to $6,ooo, which is a significant disincentive.
- Is there a maximum size for net metering systems? Are there differences for residential and commercial installations? Is there an appeals process for larger systems? Examples: Idaho – 25 kW residential, 100 commercial, Maine – 100 kW, Minnesota – 40 kW, Ohio – no limit, Texas – 50 kW, Washington state – 25 kW, California – 1 MW
- If new meters are required, who pays for them? CO – “If a customer-generator does not own a single bi-directional meter, then the utility must provide one free of charge. Systems over 10 kilowatts (kW) in capacity require a second meter to measure the output for the counting of renewable-energy credits (RECs).” (DSIRE)
- What forms of renewables are eligible? (Usually wind, solar photovoltaics, possibly methane capture)
- Are there restrictive aggregate caps for how much net metering is allowed onto a system? If there is a limit, is there an appeals process?
- Are there reporting requirements for utilities, in order to judge the effectiveness of the policy?

Interstate Renewable Energy Council (IREC), Table of State and Utility Net Metering Rules, last updated December 2007, http://www.irecusa.org/fileadmin/user_upload/ConnectDocs/December_2007_NM_table.doc

Rusty Haynes, IREC, “Net Metering and Interconnection Trends,” 2007, http://www.dsireusa.org/documents/PolicyPublications/IREC%20Updates%20&%20Trends%2020071.pdf

--- Maril Hazlett, www.climateandenergy.org